At a time when the price of almost anything is easy to find online, some dealers still resist posting pricing — including all available specials and incentives — for vehicles in inventory. What’s the fear? In general, it seems to be losing control of the negotiation process and available profit. But is this really a valid concern in today’s online world? In short, no. What transparent pricing actually does is build trust and earn you a seat at the negotiating table.
With a little online hunting, customers can find the information you’re trying to hide. Gone are the days when you could obscure pricing, or pick and choose which specials and incentives to offer. Now, a motivated customer will find what used to be privileged information with a few quick searches.
Since you can’t truly hide it anymore, voluntarily posting this information gives you an advantage. It saves time for the customer and builds trust, and even more important it puts you in the game with those low-funnel shoppers every dealer craves.
Think about it: shoppers who engage with incentive and pricing tools are already further down the funnel and are ready to buy. Without these tools, it’s likely these motivated shoppers will simply navigate to another dealer website. With these tools, your sales team still has to do the work to get the deal done, but now you’re that much closer to a sale.
Including pricing can also help you cultivate lifetime customers — a big advantage today when loyalty to a specific dealer is still only around 23 percent (Experian, November 2016). This is because transparent pricing builds trust and credibility early in the sales process so customers are more likely to continue the process with you.
This is especially valuable for your lease business. A successful lease deal — where the customer feels they were treated fairly and honestly — will more likely lead to another deal in three to five years when the initial lease is up. And so on. In this instance, the lifetime value of a customer far outweighs price control.
If you’re still not convinced, a quick look at the potential backlash of not providing transparent pricing may be enough to change your mind. Consider this scenario: a customer walks into your store and your sales associate does not mention an OEM incentive. A quick search of the OEM site reveals the available incentive. Now you’ve eroded trust and that customer will not be coming back to your store.
But it could get worse. Now imagine that customer is upset enough to take to social media and call you out for shady business practices. In today’s world where word of mouth is more valuable than paid advertising, your online reputation could be in tatters before you know it. And that will certainly negatively impact your business.
It’s clear that you cannot put the genie back in the bottle. Prices of almost anything are easy to find online, and that’s not going to change. Instead of fearing this change, embrace it as a new and valuable way of building trust and credibility to grow your business today and far into the future.